[House Report 113-669]
[From the U.S. Government Publishing Office]


113th Congress      }                                  {        Report
                        HOUSE OF REPRESENTATIVES
 2d Session         }                                  {       113-669
======================================================================
 
                       STOP UNWORTHY SPENDING ACT

                                _______
                                

 December 12, 2014.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

   Mr. Issa, from the Committee on Oversight and Government Reform, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 3345]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Oversight and Government Reform, to whom 
was referred the bill (H.R. 3345) to amend title 31, United 
States Code, to consolidate suspension and debarment offices, 
and for other purposes, having considered the same, report 
favorably thereon with amendments and recommend that the bill 
as amended do pass.

                                CONTENTS

                                                                   Page
Committee Statement and Views....................................     3
Section-by-Section...............................................    13
Explanation of Amendments........................................    16
Committee Consideration..........................................    16
Application of Law to the Legislative Branch.....................    16
Statement of Oversight Findings and Recommendations of the 
  Committee......................................................    16
Statement of General Performance Goals and Objectives............    16
Duplication of Federal Programs..................................    16
Disclosure of Directed Rule Makings..............................    17
Federal Advisory Committee Act...................................    17
Unfunded Mandate Statement.......................................    17
Earmark Identification...........................................    17
Committee Estimate...............................................    17
Budget Authority and Congressional Budget Office Cost Estimate...    17
Changes in Existing Law Made by the Bill as Reported.............    19

    The amendments (stated in terms of the page and line 
numbers of the introduced bill) are as follows:
  Page 4, line 2, insert ``suspension and debarment'' after 
``contrary''.

  Page 5, lines 23 and 24, strike ``case management system,''.

  Page 6, after line 16, insert the following:

                  ``(B) The number and summary of agency head 
                determinations, if any, that allowed a 
                suspended or debarred contractor, grantee, or 
                other recipient of Federal financial assistance 
                to receive new Federal funds.

  Page 6, line 17, strike ``(B)'' and insert ``(C)''.

  Page 12, line 18, strike ``and''.

  Page 12, line 24, strike the period and insert ``; and''.

  Page 12, after line 24, insert the following:

                  ``(D) the number and summary of agency head 
                determinations, if any, that allowed a 
                suspended or debarred contractor, grantee, or 
                other recipient of Federal financial assistance 
                to receive new Federal funds.

   Page 16, strike lines 4 through 8 and insert the following:

          ``(4) Timely referrals and processing of cases.--
                  ``(A) The regulation shall provide procedures 
                to strengthen timely referrals of cases, 
                including--
                          ``(i) the role of the agency remedy 
                        coordination official to act upon cases 
                        brought to such official's attention in 
                        a timely manner (as required in section 
                        7 of the SUSPEND Act); and
                          ``(ii) requirements for the Board or 
                        the agency suspension and debarment 
                        office to review the sufficiency of the 
                        information in the referred cases and 
                        to notify the agency remedy 
                        coordination official and cognizant 
                        Inspector General (if the case is 
                        originated from the Office of Inspector 
                        General) within 30 days after the 
                        initial referral date for any 
                        additional information if needed.
                  ``(B) The regulation shall require all cases 
                to be disposed of within 6 months after the 
                initial referral date, unless the Chair of the 
                Board or the agency suspension and debarment 
                officer provides a written explanation and 
                estimated timeline to the agency remedy 
                coordination official and cognizant Inspector 
                General (if the case is originated from the 
                Office of Inspector General). Such written 
                explanation shall be updated every 3 months 
                until the final resolution of the case.''.

  Page 17, line 14, after ``2(b)(2)'' insert ``and the merits 
of any such waiver''.

  Page 19, line 11, after ``by'' insert ``the Office of 
Inspector General of the agency or''.

                     Committee Statement and Views


                          PURPOSE AND SUMMARY

    The Federal Government seeks to protect the taxpayer by 
ensuring public funds are not improperly dissipated.\1\ To that 
end, federal agencies are required to award contracts and 
grants only to responsible sources that are ``reliable, 
dependable and capable of performing the work.''\2\
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    \1\See Kate M. Manuel, Cong. Research Serv., RL34753, Debarment and 
Suspension of Government Contractors: An Overview of the Law Including 
Recently Enacted and Proposed Amendments, at 4 (2012).
    \2\U.S. Gov't Accountability Office, GAO-11-739, Suspension and 
Debarment: Some Agency Programs Need Greater Attention, and 
Governmentwide Oversight Could be Improved, at 1 (2011) [hereinafter 
``GAO-11-739''].
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    Suspension and debarment (S&D) are two of the most powerful 
tools agencies can--and should--use to protect the government's 
interests\3\ and ``ensur[e] contract and program 
integrity.''\4\ It is not designed to punish contractors or 
grantees for past misconduct.\5\ The Committee on Oversight and 
Government Reform (the Committee) recognizes the need for a 
robust S&D program to maintain public trust and to provide a 
level playing field for all responsible entities seeking 
federal financial awards.
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    \3\See id. at 22. A debarment typically lasts for a period that is 
commensurate with the cause and generally does not exceed three years. 
See Kate M. Manuel, Cong. Research Serv., R40633, Responsibility 
Determinations Under the Federal Acquisition Regulation: Legal 
Standards and Procedures, at 4 (2013). A suspension lasts as long as 
any agency investigation of the underlying conduct or ensuing legal 
proceeding is ongoing. Id. The effect of a suspension or debarment is 
government-wide and not specific to an agency or contract. Id. If no 
legal proceeding is initiated, the suspension cannot exceed 12 months 
unless an extension is requested. See FAR 9.407-4 (2008). Any extension 
that is granted can last no longer than 6 months. See id.
    \4\Interagency Suspension and Debarment Comm. (ISDC) Rep. on 
Federal Agency Suspension and Debarment Activities (Sept. 18, 2012), 
available at http://www.epa.gov/isdc/pdf/
isdc_section_873_fy_2011_report_to_congress_lieberman.pdf [hereinafter 
ISDC Annual Report].
    \5\See Steven Gordon & Richard Duvall, United States: It's Time to 
Rethink the Suspension and Debarment Process, Bloomberg BNA, 99 FCR 
720, at 1 (June 18, 2013), available at http://www.hklaw.com/files/
Publication/dd6ffa6c-039a-48a7-9332-0160fec0dae4/Presentation/
PublicationAttachment/88ff0ebe0999e7-4094-b1e0-042dbc630a41/
TimeToRethinkSuspensionandDebarmentDuvallGordon.pdf.
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    The Federal Government spends over $1 trillion in contracts 
and grants annually (in fiscal year 2012, $517 billion in 
contracts and $536 billion in grants).\6\ Yet, despite the 
intense Congressional oversight efforts in recent years, the 
United States Government Accountability Office (GAO) and the 
Committee's hearings have found that there are serious 
weaknesses in the S&D programs of numerous agencies.\7\
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    \6\See U.S. Gov't Accountability Office, GAO-13-758, Federal Data 
Transparency: Opportunities Remain to Incorporate Lessons Learned as 
Availability of Spending Data Increases (2013) (highlights); U.S. Gov't 
Accountability Office, GAO-13-707T, Suspension and Debarment: 
Characteristics of Active Agency Programs and Governmentwide Oversight 
Efforts (2013) (statement of John Neumann, Director, Acquisition and 
Sourcing Management, U.S. Gov't Accountability Office).
    \7\Protecting Taxpayer Dollars: Is the Government Using Suspension 
and Debarment Effectively?: Hearing before the H. Comm. on Oversight 
and Gov't Reform, 113th Cong. (2013) (statement of John Neumann, 
Director, Acquisition and Sourcing Management, U.S. Gov't 
Accountability Office), (statement of Scott Amey, General Counsel, 
Project on Government Oversight); see also GAO-11-739, supra note 2, at 
3, 6.
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    These weaknesses have resulted in the award of federal 
funds to companies and individuals who are not responsible 
contractors or grantees--including those with criminal 
convictions, federal tax liabilities, or terrorist ties. It has 
also demonstrated that some agencies are either extremely 
deficient in finding fraud or that their programs are 
practically non-existent--either due to a lack of dedicated 
staff or a lack of commitment to S&D on the part of the agency.
    For example, according to the Interagency Suspension and 
Debarment Committee (ISDC), the Department of Health and Human 
Services (HHS), while awarding $402 billion in contracts and 
grants in fiscal year 2011 (which accounted for more than one 
third of the entire federal government contracts and grants 
spending for the year), had a total of 10 discretionary 
suspension or debarment actions.\8\ In fiscal year 2012, the 
agency had a total of just 2 discretionary suspension or 
debarment actions while awarding $363 billion in contracts and 
grants.\9\ Similarly, the Department of Labor (Labor), the 
Office of Personnel Management, and the Social Security 
Administration took zero discretionary S&D actions, while 
awarding approximately $11.6 billion, $1.6 billion, and $1.3 
billion respectively in contracts and grants in fiscal year 
2012.\10\
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    \8\ISDC Annual Report, supra note 5, at 22.
    \9\See FY 2012--Preliminary Data from ISDC, E-mail from ISDC to 
Eric Cho, H. Comm. on Oversight and Gov't Reform (Oct. 24, 2013, 16:47 
EST) (on file with recipient); USASpending.gov.
    \10\See id.
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    In 2011, GAO found commonalities amongst those agencies 
with negligible or weak S&D activities, which do not appear to 
reflect the level of activity needed to protect their agencies 
and the government from harm. Common at those agencies is the 
lack of: (1) a dedicated staff; (2) detailed policies and 
procedures; and (3) practices that encourage an active referral 
process.\11\
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    \11\GAO-11-739, supra note 2, at 12.
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    The S&D process at some agencies has also been further 
criticized for a lack of access to the system and a lack of 
transparency.\12\ Currently, there is little consistency 
between agencies' S&D programs, with different agencies 
employing significantly different approaches to the S&D 
process. For example, there are wide disparities in such key 
areas as:
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    \12\See Protecting Taxpayer Dollars: Is the Government Using 
Suspension and Debarment Effectively?: Hearing before the H. Comm. on 
Oversight and Gov't Reform, 113th Cong. (2013).
---------------------------------------------------------------------------
     The use and frequency of use of show cause 
letters\13\ vs. direct notices of suspension or proposed 
debarment.
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    \13\Show cause letters are ``pre-notice communications, which 
advise an entity that it is being considered for suspension or proposed 
debarment.'' ISDC Annual Report, supra note 5, at 8. 10 out of the 24 
Chief Financial Officers Act (``CFO Act'') agencies used show cause 
letters in fiscal year 2011. See id.
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     Different views on acceptable remedial measures 
such as administrative compliance agreements.
     The process by which S&D cases are prepared and 
referred to.
     The process by which administrative records are 
prepared.
     The process by which informal no action decisions 
are made and documented.
     The use of consensus panels.
     What ``informal procedures''\14\ are employed and 
communication afforded to the accused.
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    \14\The FAR calls for informal practices whenever possible when 
dealing with a vendor. See FAR 9.406-3(b)(1) (2013) (``agencies shall 
establish procedures governing the debarment decisionmaking process 
that are as informal as is practicable'').
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    The Stop Unworthy Spending Act (SUSPEND Act) reforms S&D 
procedures and overhauls the organizational management of S&D 
activity across the government.
    Procedurally, it improves consistency and transparency by:
          i) Combining the two separate S&D regulations 
        governing contracts and grants into a single, 
        comprehensive regulation;\15\
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    \15\See How Convicts and Con Artists Receive New Federal Contracts: 
Hearing before the H. Comm. on Oversight and Gov't Reform, 111th Cong. 
(2009) (statement of Frederic M. Levy, Partner, McKenna Long & 
Aldridge). The single regulation has been suggested by the American Bar 
Association, Public Contract Law Section, Committee on Debarment and 
Suspension. Its draft Report on the Study of Federal Debarment and 
Suspension Processes, however, was not finalized. See id. The single 
regulation will provide contractors with greater access to the 
processes behind the suspension and debarment system.
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          ii) Requiring consistent use of show cause letters to 
        ensure accused parties are heard prior to any adverse 
        action being taken against them;\16\
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    \16\See Protecting Taxpayer Dollars: Is the Government Using 
Suspension and Debarment Effectively?: Hearing before the H. Comm. on 
Oversight and Gov't Reform, 113th Cong. (2013) (Testimony of Angela 
Styles, Partner, Crowell & Moring).
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          iii) Mandating a single government-wide case 
        management system to track cases and make publicly 
        available all final resolutions of S&D cases; and
          iv) Enhancing oversight of the excluded parties 
        database (known as the System for Award Management or 
        SAM)\17\ to ensure accuracy, timeliness, and 
        completeness.
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    \17\SAM includes the list of all known excluded entities. Under the 
SUSPEND Act, the Board of Suspension and Debarment would be required to 
oversee SAM contains a complete and accurate list of all excluded 
entities.
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    It also requires standard procedures for an expedited 
review process to handle contract or grant fraud in a 
contingency or time-sensitive environment, in both military and 
non-military settings.
    Organizationally, the SUSPEND Act consolidates more than 40 
executive agency S&D offices into one centralized board--the 
Board of Suspension and Debarment (the Board). This is akin to 
a successful reform effectuated by the Committee almost a 
decade ago, which consolidated what was then eight separate 
civilian agency Boards of Contract Appeals (as part of fiscal 
year 2006 National Defense Authorization Act) into a single 
entity.\18\
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    \18\See The Honorable Jeri Kaylene Somers, The Board of Contract 
Appeals: A Historical Perspective, 60 AM. U. L. REV. 745, 755-56 (2011) 
(noting the consolidation of the civilian boards ``has been extremely 
successful, optimizing the role boards play in resolving contract 
disputes'').
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    By consolidating the S&D offices, the Board will foster 
more government-wide consistency for how discretionary S&D 
actions are managed and tracked and ensure agencies have 
dedicated staff and resources committed to creating a robust 
S&D referral program. The Board will also be able to optimize 
the staff and administrative resources necessary to accommodate 
S&D caseloads, thereby reducing costs and increasing 
efficiencies.\19\
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    \19\Currently, there are approximately 80 full time and 149 part 
time attorneys and staff engaged in S&D activities in civilian 
agencies. The Department of Defense has 24 full time and 8 part time 
attorneys and staff. Overall, there are estimated 104 full time and 157 
part time staff in 24 CFO Act agencies. See ISDC, Supplemental to CRS 
Inquiry, Federal Suspension and Debarment Programs.
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    However, larger (CFO Act) agencies and the military 
departments can continue to operate their own independent S&D 
offices if granted a waiver upon demonstration of an effective 
S&D program. Specifically, those agencies need to show: (1) a 
dedicated S&D staff; (2) detailed agency-specific policies and 
procedures relating to S&D (3) practices that encourage an 
active S&D referral process; (4) a consolidated S&D program 
with only one individual with the title of Suspension and 
Debarment Officer (SDO); and (5) average annual dispositions of 
50 or more S&D cases.\20\
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    \20\Id. Fifty cases were chosen simply as an approximate number to 
ensure that the SDO had enough caseloads to occupy him or herself full-
time. A disposition may be an adverse action, a decision not to 
proceed, or any other appropriate action. In the DoD components--DLA, 
Navy, Army and Air Force--suspension and debarment officers handled 
3,443 S&D between fiscal years 2009 through 2011. See U.S. Gov't 
Accountability Office, GAO-12-932, Suspension and Debarment: DOD has 
Active Referral Processes, but Action Needed to Promote Transparency, 
at 3 (2012) (note this number only includes those proposed for 
debarment or suspension actions and does not track how many referrals 
each military department received). DLA alone handled 1,168 cases 
during fiscal years 2009 through 2011. Id. (noting DLA has three full 
time attorneys working on S&D cases).
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    The bill strengthens the existing ISDC by formalizing and 
codifying it in statute (it currently operates pursuant to an 
Executive Order) and by designating as Chair, the Administrator 
of OMB's Office of Federal Procurement Policy (OFPP). The ISDC 
currently operates both as a ``forum for agencies to discuss 
best practices and trends, and current issues and challenges,'' 
and is ``a coordinating body to promote efficient handling of 
actions by ensuring there is a `lead agency' when two or more 
agencies have an interest in initiating suspension or debarment 
proceedings.''\21\ Even with the consolidation of agency S&D 
programs, it will still be necessary for the ISDC to coordinate 
lead agency functions amongst the Board and the agencies 
granted a waiver under the SUSPEND Act.\22\
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    \21\ISDC Annual Report, supra note 5, at 1.
    \22\See id.
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    The bill also requires joint Agency Head/Inspector General 
guidance in each agency to institutionalize efficient agency-
wide coordination of remedies for fraud and corruption related 
to procurement and grant activities, including legal, 
regulatory, administrative, and contractual remedies to 
maximize timely recovery of funds.
    Finally, the bill will strengthen the identification and 
referral of contractors and grantees that repeatedly fail to 
perform. Too often, a contractor is awarded a new government 
contract despite a lengthy history of poor performance on 
government contracts.\23\
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    \23\See Kate M. Manuel, Cong. Research Serv., R41562, Evaluating 
the Past Performance of Federal Contractors, at 1 (2013) (noting there 
are recent reports documenting that some contractors received new 
contracts despite allegedly deficient performance); see also Neil 
Gordon, Healthcare.gov Reveals Flaws in Contractor Screening, POGO 
BLOG, (Jan. 3. 2014), http://www.pogo.org/blog/2014/01/healthcaregov-
debacle-revelas-flaws-in-contractor-screening.html.
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                  BACKGROUND AND NEED FOR LEGISLATION

Government's inconsistent performance in managing S&D

    GAO has consistently reported on weaknesses in agencies' 
S&D programs and on the weaknesses of the system as a whole. In 
2005, GAO reported that ``federal agencies may not be 
consistently identifying suspended or debarred contractors when 
awarding new contracts.''\24\ Specifically, GAO found the 
Excluded Parties List System (EPLS) contained insufficient data 
because it did not allow agencies to input contractor's unique 
identification numbers.\25\ The report made two 
recommendations: (1) make contractor identification numbers a 
required field on the EPLS, and (2) increase data sharing on 
administrative agreements.\26\
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    \24\GAO-11-739, supra note 2, at 6; see also U.S. Gov't 
Accountability Office, GAO-05-479, Additional Data Reporting could 
Improve the Suspension and Debarment Process, (2005).
    \25\GAO-05-479, supra note 27, at 3.
    \26\Id.
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    In 2009, GAO found that some contractors continued to 
receive federal funds despite the fact that they were 
ineligible to be awarded contracts.\27\ This, in part, was due 
to the continuing weaknesses of the EPLS system--ineffective 
management of the system and missing unique identification 
numbers, even though GAO in 2005 recommended that the unique 
identifiers be a required field in the system.\28\ In addition, 
contracting officers often received ``no results from EPLS 
searches because of typographic and user input errors.''\29\ 
SAM, the system now hosting the excluded parties list used by 
all contracting and grant officers, remains incomplete, 
inaccurate, and not user-friendly.
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    \27\ GAO-11-739, supra note 2, at 6; see also U.S. Gov't 
Accountability Office, GAO-09-174, Excluded Parties List System: 
Suspended and Debarred Businesses and Individuals Improperly Receive 
Federal Funds (2009). While the FAR recognizes that there are some 
circumstances where it is appropriate to award a contract to a 
suspended or debarred contractor, such circumstances must be 
compelling. FAR 9.405(a).
    \28\See GAO-09-174, supra note 30, at 16; GAO-05-479, supra note 
27, at 3.
    \29\Inspector General Report, No. D-2011-83, Additional Actions Can 
Further Improve the DoD Suspension and Debarment Process, at 19 (July 
14, 2011) [hereinafter Inspector General Report].
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    In 2011, GAO again issued a report on the status of 
agencies' S&D programs.\30\ GAO found that only 16 percent of 
the cases included on EPLS were discretionary suspensions or 
debarments over the last five fiscal years, suggesting a 
systemic weakness in referral process.\31\ The remaining 84 
percent of the cases ``were other exclusions based on 
violations of laws and regulations resulting from certain 
prohibited conduct.''\32\ Such exclusions are mandatory because 
they are required by statute.\33\ Though GAO noted that some 
agencies have effective S&D programs, many agencies do not.\34\
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    \30\GAO-11-739, supra note 2.
    \31\Id. at 7.
    \32\Id.
    \33\See Manuel, supra note 1, at 1-2.
    \34\See GAO-11-739, supra note 2, at 3.
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    In addition to GAO's findings, the Committee's hearings 
found that the current system produces inconsistent results and 
leaves each agency to devise individual procedures in handling 
suspension or debarment cases. For example, though some 
agencies use ``show cause'' letters in S&D proceedings, other 
agencies either do not use such letters or are not fully aware 
of this process.\35\ Similarly, not all agencies use 
administrative agreements to help resolve suspensions and 
debarments and the content of those administrative agreements 
can vary significantly amongst the various agencies.\36\
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    \35\See Protecting Taxpayer Dollars: Is the Government Using 
Suspension and Debarment Effectively? Hearing Before the H. Comm. on 
Oversight and Gov't Reform, 113th Cong. (2013) (Testimony of Angela 
Styles, Partner, Crowell & Moring). Significantly, recent studies 
report a ``general lack of awareness about suspension and debarment, 
including limited knowledge about the procedures/criteria associated 
with these actions.'' Manuel, supra note 1, at 17.
    \36\See ISDC Annual Report, supra note 5, at 9.
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    Recently, at an Oversight and Government Reform (OGR) 
subcommittee hearing concerning the Special Inspector General 
for Afghanistan Reconstruction (SIGAR), the lack of effective 
S&D referral and case management in contingency settings was 
seen as a significant source of waste and performance 
risks.\37\
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    \37\See also Commission on Wartime Contracting in Iraq and 
Afghanistan, Transforming Wartime Contracting: Controlling Costs, 
Reducing Risks, Final Report to Congress, 156, 157 (Aug. 2011), 
available at http://cybercemetery.unt.edu/archive/cwc/20110929213820/
http://www.wartimecontracting.gov/docs/CWC_FinalReport-lowres.pdf.
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    Finally, despite GAO issuing guidance to the agencies to 
assess and strengthen their S&D programs, a report by the ISDC 
(dated September 18, 2012) reflected persistent weaknesses 
amongst some of the agencies such as HHS, Commerce, Labor, and 
the Department of Veterans Affairs (VA).\38\
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    \38\See generally id.
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    There is also currently not enough emphasis on suspending 
or debarring contractors and grantees that repeatedly fail to 
perform. Time and time again, agencies award contracts to those 
contractors or grantees that have a history of repeated bad 
performance.\39\ The SUSPEND Act addresses this problem by 
making it clear that the single regulation adopted must 
strengthen the identification and referral process of those 
contractors and grantees that repeatedly fail to perform.
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    \39\See Protecting Taxpayer Dollars: Is the Government Using 
Suspension and Debarment Effectively?: Hearing Before the H. Comm. on 
Oversight and Gov't Reform, 113th Cong. (2013) (Testimony of Scott 
Amey, General Counsel, Project on Government Oversight) (noting the 
Army used multiple contractors in Iraq with a ``laundry list of 
allegations against them''). Agencies may also waive a contractor's 
exclusion which allows the contract to be awarded to a contractor or 
grantee that is currently included on the EPLS. See Manuel, supra note 
1, at 13.
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Dual regulations for procurement and non-procurement programs

    There are currently two separate regulations governing S&D 
for procurement and non-procurement programs.\40\ FAR Subpart 
9.4--promulgated by the Office of Federal Procurement Policy 
(OFPP) governs procurement regulations, while the non-
procurement common rule governs anything other than a 
procurement. This includes such thing as ``grants, cooperative 
agreements, scholarships, fellowships'' and many others.\41\ If 
a contractor is excluded under one of the regulations, there is 
reciprocity between both of the regulations and it counts as a 
suspension or debarment Government-wide.\42\
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    \40\Those two regulations are FAR Subpart 9.4 which governs 
procurement and 2 CFR Sec. 180 (2013) (as governed by OMB guidance).
    \41\2 CFR Sec. 180.970 (2013).
    \42\GAO-11-739, supra note 2, at 5 (noting ``a suspension or 
debarment under either the FAR or the NCR is recognized under the other 
and a party precluded from participating in federal contracts is also 
excluded from receiving grants, loans, and other assistance and vice 
versa.'').
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    In 2008, the Suspension and Debarment Committee of the ABA 
Public Contract Law Section suggested that the two regulations 
be consolidated into one regulation with the non-procurement 
common rule approach being adopted, which does not exclude a 
contractor upon receipt of a ``Notice of Proposed 
Debarment.''\43\
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    \43\How Convicts and Con Artists Receive New Federal Contracts: 
Hearing before the H. Comm. on Oversight and Gov't Reform, 111th Cong. 
(2009) (statement of Frederic M. Levy, Partner, McKenna Long & 
Aldridge).
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Persistent problems with the system for award management

    Previously, separate acquisition systems tracked different 
aspects of the procurement process, described as follows. The 
EPLS listed all those individuals or organizations that were 
excluded from doing business with the Federal Government.\44\ A 
contracting officer was required to check the EPLS before 
awarding funds to a prospective vendor.\45\ The Central 
Contract Registration (CCR) system was the primary supplier 
database for the Federal Government. Finally, the Online 
Representations and Certification Application (ORCA) collected 
``vendor representations and certifications of business 
information that is required by law for contract award.''\46\
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    \44\See GAO-09-174, supra note 30, at 6.
    \45\Id. at 1.
    \46\Crater Procurement Assistance Center, Online Representations 
and Certifications Application (ORCA), http://craterptac.org/
federal_procurement/orca.php (last visited Feb. 21, 2014).
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    In 2012, as the first phase of the Integrated Acquisition 
Environment effort, these three systems were consolidated into 
the System of Award Management (SAM). Issues with SAM were 
present from the start.\47\ When the system first went online 
in July, it had to almost immediately be taken off-line due to 
performance issues.\48\ This delayed the issuance of timely 
awards and also caused some agencies to stop using the system 
altogether.\49\ More recently, GSA officials identified 
security vulnerabilities in SAM, some of which allowed existing 
users in the system to view others' registration 
information.\50\
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    \47\See Matthew Weigelt, GSA's SAM continues to frustrate its 
users, FCW, (Sept. 13, 2012), http://fcw.com/articles/2012/09/15/buzz-
system-for-award-management-gsa.aspx.
    \48\See id.
    \49\See id.
    \50\See General Services Administration, System for Award 
Management Security Vulnerability FAQs, http://www.gsa.gov/portal/
content/167855.
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    As was the case with the EPLS, a contracting officer is 
required to check the SAM exclusions list before contract 
award.\51\
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    \51\FAR 9.405 (2013).
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Inconsistent application of administrative agreements

    Use of administrative agreements is increasing in recent 
years.\52\ In a 2012 report, GAO found DoD used such agreements 
in 30 cases over a three-year period.\53\ Administrative 
agreements are currently unregulated; it is up to the 
discretion of the SDO as to whether or not to enter into an 
administrative agreement.\54\
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    \52\See Gordon & Duvall, supra note 6.
    \53\See id. The three-year period tracked was for fiscal years 2009 
through 2011. Id.
    \54\See id.
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    Administrative agreements can be used in lieu of suspension 
or debarment where the SDO decides it is inappropriate to take 
suspension or debarment action at the time.\55\ These 
agreements are designed to ensure compliance such that future 
S&D action will be unnecessary.\56\ Administrative agreements 
usually include ``a requirement for a code of ethics, a 
training and compliance program, and a mechanism for reporting 
misconduct.''\57\ Violations of administrative agreements can 
lead to S&D actions.\58\
---------------------------------------------------------------------------
    \55\See Protecting Taxpayer Dollars: Is the Government Using 
Suspension and Debarment Effectively?: Hearing before the H. Comm. on 
Oversight and Gov't Reform, 113th Cong. (2013) (statement of Angela B. 
Styles, Partner, Crowell & Moring).
    \56\See id.
    \57\See Inspector General Report, supra note 32, at 3.
    \58\See id.
---------------------------------------------------------------------------

Mandatory disclosure rule

    In February 2007, the Civilian Agency Acquisition Council 
and the Defense Acquisitions Regulations Council (Councils) 
proposed amending the Federal Acquisition Regulation (FAR) to 
require Government contractors to have a code of ethics and 
business conduct and to promote Office of the Inspector General 
(OIG) fraud hotlines by displaying posters.\59\ In May 2007, 
the Department of Justice (DOJ) requested the Councils to 
consider amending the FAR to require Government contractors to 
notify the Government if they identify violations of criminal 
law or contract overpayment. In response, the Office of Federal 
Procurement Policy directed the FAR Councils to implement DOJ's 
recommendations.\60\ The Councils proposed a mandatory 
reporting requirement in response to another DOJ request in 
late 2007.\61\ In the Supplemental Appropriations Act of 2008, 
Congress further required that the FAR rule included ``timely 
notification by Federal contractors of violations of Federal 
criminal law or overpayments in connection with the award or 
performance of covered contracts or subcontracts, including 
those performed outside the United States and those for 
commercial items.''\62\
---------------------------------------------------------------------------
    \59\See Contractor Code of Ethics and Business Conduct, 72 Fed. 
Reg. 7588 (Feb. 16, 2007).
    \60\See Karen L. Manos, Complying with the New Mandatory Disclosure 
Rule, Gov't Contract Cost, Pricing and Accounting Report,. 1, Gov't 
Contract Costs, Pricing & Accountability Report at 1,(2009), available 
at http://www.gibsondunn.com/publications/Documents/Manos-
ComplyingWithMandatoryDisclosureRule.pdf.
    \61\See Contractor Compliance Program and Integrity Reporting, 72 
Fed. Reg. 64019 (Nov. 14, 2007).
    \62\See Supplemental Appropriations Act, Pub. L. No. 110-252, 
Sec. 6102, 122 Stat. 2386 (2008).
---------------------------------------------------------------------------
    The final rule took effect in December 2008.\63\ The 
mandatory disclosure rule requires ``Government contractors and 
subcontractors to disclose to the Government whenever they have 
`credible evidence' of certain criminal violations, a violation 
of the False Claims Act, or a significant `overpayment' in 
connection with the award, performance or closeout of a 
Government contract or subcontract.''\64\ The mandatory 
disclosure rule was created as a response to the lack of 
voluntary disclosures from contractors or subcontractors.\65\
---------------------------------------------------------------------------
    \63\See Contractor Business Ethics Compliance Program and 
Disclosure Requirements, 73. Fed. Reg. 67064, 67066 (Nov. 12, 2008).
    \64\Manos, supra note 56, at 4.
    \65\See Brian D. Miller, The Federal Acquisition Regulation 
Mandatory Disclosure Rule Program at the U.S. General Services 
Administration Office of the Inspector General, at 2 (2012), available 
at http://www.gsaig.gov/?LinkServID=FC200536-C294-E918-1FD147DE0F340B80 
&showMeta=0 (noting that at the time the mandatory disclosure rule took 
effect, the program was receiving less than 10 disclosures per year).
---------------------------------------------------------------------------
    The Committee is aware that some agencies with weak or 
deficient S&D programs also appear to have weak mandatory 
disclosure programs. These agencies either do not have a 
specific point person for outside entities to disclose 
reportable incidents or do not have an established process to 
handle disclosures. The number of disclosures vary widely among 
agencies, with no reasonable association with the volume of 
contracting activities, while a handful agencies report no or 
very few disclosures.\66\ Most agencies use the OIG to handle 
disclosures, but some do not. For example, multiple components 
within HHS handle disclosures in that agency.\67\
---------------------------------------------------------------------------
    \66\For example, the Department of Treasury received 0 disclosures 
from the date of enactment of the mandatory disclosure rule, while the 
Department of Energy and the Department of Veterans Affairs had just 1 
and 3 disclosures, respectively. See E-mail from Sheldon Shoemaker, 
Special Assistant to the Inspector Gen., Small Bus. Admin. to Eric Cho, 
H. Comm. on Oversight and Gov't Reform (Mar. 13, 2014, 10:15 EST) (on 
file with recipient).
    \67\See id. The components that handle mandatory disclosures within 
HHS include: the Office of Counsel to the Inspector General, the Office 
of Audit Services, and the Office of Investigations. See id.
---------------------------------------------------------------------------
    The Committee believes that there should be a single 
component within the agency, such as the OIG, with clear 
procedures to handle disclosures under the mandatory disclosure 
rule. Serious violations should also be referred from the OIG 
to the agency's S&D official for further review.

Oversight by the House Oversight and Government Reform Committee

    The SUSPEND Act is the outgrowth of Committee hearings 
concerning the effectiveness of the Government's current S&D 
programs in light of reports detailing the numerous flaws in 
the current system.\68\ Starting in the 112th Congress, the 
Committee began a detailed inquiry concerning each agency's S&D 
program.
---------------------------------------------------------------------------
    \68\See, e.g., GAO-11-739, supra note 2, at 6; Manuel, supra note 
1, at 16-17 (noting studies found the vast majority of debarment 
actions mandatory).
---------------------------------------------------------------------------
    On October 6, 2011, the Committee held a hearing entitled: 
``Protecting Taxpayer Dollars: Are Federal Agencies Making Full 
Use of Suspension and Debarment Sanctions?'' This hearing 
examined why some agencies are effective at using the S&D 
remedy to weed out contractors who defraud the government while 
others languish far behind. This hearing highlighted 
characteristics of agencies with effective S&D programs while 
illustrating the substantial weaknesses of other agencies' S&D 
programs.
    On June 12, 2013, the Committee held a hearing entitled: 
``Protecting Taxpayer Dollars: Is the Government Using 
Suspension and Debarment Effectively?'' This hearing once again 
examined the continued shortcomings of the S&D system such that 
inconsistent and fragmented approaches persisted and contracts 
continue to be awarded to contractors or grantees where failure 
has been the past result. It also took note of the recent 
growth in grants spending. This hearing highlighted that the 
S&D process is still in disarray and that greater and more 
comprehensive reform is needed.
    Though there has been some improvement with S&D in recent 
years, the Committee's hearings have established the need for 
further S&D reform. In a time where there are constant news 
reports regarding another contractor who has defrauded the 
government or repeatedly failed to perform its contracts, it 
has never been more important to have a robust S&D process. In 
order to better protect the taxpayer and the business interests 
of the Federal Government and to provide a level playing field 
for vast majority of companies and individuals that are 
responsible contractors and grantees, the S&D process needs to 
become more transparent, consistent, and effective.

Divergent statutory and debarment practices

    In addition to weaknesses in agencies' S&D programs, there 
has also been a growing amount of legislation from various 
Congressional members creating mandatory statutory suspensions 
and debarments.\69\ The 112th Congress enacted or considered 
numerous narrowly-focused measures to bolster the S&D function. 
These proposals, while well-intentioned, are often impractical 
or have limited outcomes (see e.g., P.L. 112-74; P.L. 112-81; 
P.L. 112-56; H.R. 2838; H.R. 3184; H.R. 3338; H.R. 3588; H.R. 
3638; S. 914; S. 1196; S. 1258; S. 1363; S. 1472).\70\ They are 
ineffective because they impose mandatory statutory debarments 
in specific circumstances, tying the hands of the S&D offices 
and transforming the system into a punitive approach that 
diverges from the basic purpose of S&D, i.e. to protect the 
business interests of the government.\71\ Without comprehensive 
reform, these trends are likely to continue.
---------------------------------------------------------------------------
    \69\See American Bar Association, Public Contract Law Section, 
Committee on Debarment and Suspension, Report on the Study of Federal 
Debarment and Suspension Processes Working Draft (2008) [hereinafter 
ABA 2008 Working Draft]; see also Jessica Tillipman, The Congressional 
War on Contractors, 45 Geo. Wash. Int'l L. Rev. 235 (2013).
    \70\Some of these proposals are discussed in more detail infra.
    \71\See ABA 2008 Working Draft, supra note 47, at 1; Tillipman, 
supra note 47, at 236-37.
---------------------------------------------------------------------------

                     LEGISLATIVE AND POLICY HISTORY

Office of Management and Budget guidance on S&D

    On November 15, 2011, Jacob Lew, then-Director of the 
Office of Management and Budget (OMB), released a Memorandum 
following a GAO report directing the 24 agencies subject to the 
Chief Financial Officers Act (``CFO Act'') to take action to 
strengthen their S&D programs.\72\ The Memorandum specified 
action to be taken in the following four areas:
---------------------------------------------------------------------------
    \72\Memorandum from Jacob J. Lew, Director, U.S. Office of Mgmt. & 
Budget, to the Heads of Executive Dep'ts and Agencies (Nov. 15, 2011), 
available at http://www.whitehouse.gov/sites/default/files/omb/
memoranda/2012/m-12-02.pdf.
---------------------------------------------------------------------------
    (1) Appoint a senior accountable official, if one has not 
already been designated, who shall be responsible for: (a) 
assessing the agency's suspension and debarment program, 
including the adequacy of available training and resources 
(including, where appropriate, full-time staff), (b) ensuring 
the agency maintains effective internal controls and tracking 
capabilities, taking into consideration the agency's mission, 
organizational structure, and level of procurement and grant-
making activities; and (c) ensuring that the agency 
participates regularly on the Interagency Suspension and 
Debarment Committee.\73\
---------------------------------------------------------------------------
    \73\Id.
---------------------------------------------------------------------------
    (2) Review internal policies, procedures, and guidance to 
ensure that the agency is protecting the Government's interests 
and taxpayer funds by effectively using suspension and 
debarment, when appropriate, as well as other remedies 
available to the agency that are designed to ensure, before an 
award is made, that potential contractors and recipients have 
the requisite business integrity.\74\
---------------------------------------------------------------------------
    \74\Id.
---------------------------------------------------------------------------
    (3) Ensure that the agency's award official(s) review 
relevant databases and other information sources prior to the 
award of any Federal grants, contracts, or benefits, to prevent 
awards from being made to entities that are suspended or 
debarred or are otherwise non-responsible.\75\
---------------------------------------------------------------------------
    \75\Id.
---------------------------------------------------------------------------
    (4) Take prompt corrective action, including appropriate 
action regarding the specific award and establishment of 
systemic controls and procedures to prevent recurrence, when 
the agency determines that it improperly made an award to a 
suspended or debarred entity.\76\
---------------------------------------------------------------------------
    \76\Id.
---------------------------------------------------------------------------
    The Memorandum also directed the ISDC to assist the 
agencies with these activities and to ``develop training and 
share best practices, ensure effective interagency coordination 
of suspension and debarment actions, and [to] report on 
agencies' activities as required.''\77\
---------------------------------------------------------------------------
    \77\Id.
---------------------------------------------------------------------------

Interagency Suspension and Debarment Committee

    The ISDC is designed to be a forum where agencies can 
discuss best practices, trends, current issues and challenges 
and is supposed to provide expert analysis and advice.\78\ The 
ISDC includes about 50 member agencies and ``[c]ommittee 
members meet monthly to discuss topics of interest in 
Government-wide S&D'' and to ``monitor[] participation in the 
Government S&D system.''\79\ The ISDC also helps to ensure 
agencies demonstrate transparency and administrative fairness 
when taking suspension or debarment actions.\80\
---------------------------------------------------------------------------
    \78\ISDC Annual Report, supra note 5, at 1.
    \79\See Inspector General Report, supra note 32, at 5.
    \80\See id.
---------------------------------------------------------------------------
    The ISDC came into existence in 1986 when President Reagan 
issued Executive Order 12549, Debarment and Suspension.\81\ 
This Executive Order restricted the jurisdiction of the ISDC to 
non-procurement matters.\82\ Subsequently, the ISDC's role 
began to grow and it began to coordinate S&D issues throughout 
the various agencies.\83\ Currently, the ISDC also serves as 
``a regulatory drafting body for revisions to the government-
wide non-procurement suspension and debarment common 
rule.''\84\
---------------------------------------------------------------------------
    \81\Brian Young, Ready for Primetime? The Interagency Suspension 
and Debarment Committee, the Non-Procurement Common Rule, and Lead 
Agency Coordination, 4 Wm. & Mary Pol'y Rev. 110, 120-21 (2012).
    \82\See id. at 122.
    \83\See id. at 130.
    \84\Todd J. Canni, Shoot First, Ask Questions Later: An Examination 
and Critique of Suspension and Debarment Practice Under the FAR, 
Including a Discussion of the Mandatory Disclosure Rule, the IBM 
Suspension, and Other Noteworthy Developments, 38 Pub. Cont. L.J. 547, 
562 (2009).
---------------------------------------------------------------------------
    In 2008, Congress passed legislation which required the 
ISDC to coordinate a lead agency if more than one agency had an 
interest in taking a suspension or debarment action.\85\ In 
addition, the legislation required the ISDC to report every 
year to Congress on the status of the S&D system.\86\
---------------------------------------------------------------------------
    \85\Young, supra note 57, at 111.
    \86\See Duncan Hunter National Defense Authorization Act, Pub. L. 
No. 110-417, Sec.  872, 122 Stat. 4356, 4555 (2008); ISDC Annual 
Report, supra note 5.
---------------------------------------------------------------------------

112th Congress's Legislative Changes to S&D

    The 112th Congress enacted several measures narrowly 
addressing some areas of S&D in the National Defense 
Authorization Act for FY2013.\87\ These included mandating a 
minimum level of staffing and maintaining adequate resources 
for the S&D functions of DoD, the Defense Logistics Agency, the 
Department of State, and the U.S. Agency for International 
Development;\88\ amending the Small Business Act ``to restate 
the grounds upon which small businesses that misrepresent their 
size or status (e.g., woman-owned) are suspended, and requiring 
annual reports by the Small Business Administration on the 
number of contractors proposed for exclusion, among other 
things,\89\ and requiring that the Department of Veterans 
Affairs (VA) debar for not less than five years firms that 
willfully and intentionally misrepresented their status to the 
VA's Veterans First Contracting program.\90\
---------------------------------------------------------------------------
    \87\See National Defense Authorization Act for FY2013, Pub. L. No. 
112-239, 126 Stat. 1632-2312 (2013) [hereinafter ``NDAA FY2013''].
    \88\NDAA FY2013, Pub. L. No. 112-239, 126 Stat. 1632-2312 (2013).
    \89\Id. at Sec.  1682-82, 126 Stat. 2086.
    \90\Honoring American's Veterans and Caring for Camp Lejeune 
Families Act of 2012, Pub. L. No. 112-154, Sec.  706, 126 Stat. 1206 
(2012). Others measures passed by the 112th Congress that address 
suspension and debarment include the following: (a) requiring 
consideration of debarment and suspension in DoD guidance regarding the 
remedial actions to be taken against contractors found to have supplied 
counterfeit electronic parts, see National Defense Authorization Act 
for FY 2012, Pub. L. No. 112-81, Sec.  818, 125 Stat. 1493-1500 (Dec. 
31, 2011); (b) prohibiting the use of funds made available under 
certain appropriations measures from being used to enter contracts or 
agreements with corporations that have any unpaid federal tax liability 
or that have been convicted of a felony under federal law within the 
preceding 24 months, unless the agency has considered excluding the 
company and determined the action is not necessary to protect the 
interests of the government, see Manuel, supra note 1, at 19; and (c) 
requiring, as part of a study and report, the number of persons who 
have been debarred or suspended because of delinquent tax debt over the 
past three years, see id.
---------------------------------------------------------------------------

            Section-by-Section (As Amended by the Committee)


Section 1. Short Title; table of contents

    Provides the title and the table of contents.

Section 2. Consolidation of suspension and debarment offices

    Consolidates more than 40 executive agency S&D offices and 
programs into one centralized board named the Board of 
Suspension and Debarment (the Board). Encourages cost savings 
by sharing administrative resources with the pre-existing 
Civilian Board of Contract Appeals, also housed in GSA.
    Allows larger agencies (24 agencies under the Chief 
Financial Officers Act (31 U.S.C. Sec.  901(b)), listed below) 
and the military departments (5 U.S.C. Sec.  102) to continue 
to operate their own independent S&D offices if granted a 
waiver upon demonstration of an effective S&D program within 
the agency.
    The Department of Agriculture, the Department of Commerce, 
the Department of Education, the Department of Energy, the 
Department of Health and Human Services, the Department of 
Homeland Security, the Department of Housing and Urban 
Development, the Department of the Interior, the Department of 
Justice, the Department of Labor, the Department of State, the 
Department of Transportation, the Department of the Treasury, 
the Department of Veterans Affairs, the Environmental 
Protection Agency, the National Aeronautics and Space 
Administration, the Agency for International Development, the 
General Services Administration, the National Science 
Foundation, the Nuclear Regulatory Commission, the Office of 
Personnel Management, the Small Business Administration, and 
the Social Security Administration.
    Allows an outside entity, such as the United States Postal 
Service (USPS), to enter into an agreement to transfer S&D 
activities to the Board as needed.
    Requires the Board to oversee the government-wide excluded 
parties database (i.e., the System for Award Management (SAM)) 
to ensure availability of timely, accurate, and complete data, 
and to promote consistent and fair treatment of all persons and 
entities subject to S&D proceedings, including small businesses 
with limited resources.
    Mandates that the annual report to Congress (by the Board 
and the Interagency Suspension and Debarment Committee (ISDC)) 
include the number and summary of any instance where the agency 
head made a determination to override the S&D decision and 
allowed a suspended or debarred entity to receive new contracts 
or grants.

Section 3. Interagency Suspension and Debarment Committee

    Strengthens the existing ISDC by formalizing and codifying 
it in statute (it currently operates pursuant to an Executive 
Order) and designating as Chair, the Administrator of OMB's 
Office of Federal Procurement Policy (OFPP) and as Vice Chairs, 
the Chair of the Board of Suspension and Debarment and a 
designee of the Secretary of Defense.
    Refines the annual ISDC report process (under Sec. 873 of 
FY2009 NDAA) by requiring it to be timely and to include data 
on the number of referrals, timeliness of case disposition, the 
breakdown of discretionary and nondiscretionary actions, and 
the number and summary of any agency waivers where a suspended 
or debarred entity received new federal funds.

Section 4. Single case management system

    Establishes a single government-wide web-based S&D case 
management system for use by the Board and agency S&D 
officials. Requires the case status and the name of the 
official handling the case be updated each month.
    Prohibits any release of pre-decisional information, 
including the names of the entities or individuals referred to, 
unless determined to be necessary to protect the interest of 
the Government.

Section 5. Single regulation for procurement and nonprocurement 
        programs

    Combines the two separate S&D regulations governing 
contracts and grants into a single, comprehensive regulation 
that provides:
           the use of show cause letters to ensure 
        accused parties are heard prior to any adverse action 
        being taken against them;
           transparent handling of all cases, including 
        public availability of all final resolutions;
           timely and consistent referrals, including 
        the identification of contractors and grantees that 
        repeatedly fail to perform;
           standard procedures for an expedited review 
        process to handle contract or grant fraud in a 
        contingency or time-sensitive environment, in both 
        military and non-military settings;
           acceptance or rejection of referrals by the 
        SDO within 30 days; and
           resolution of S&D cases within 6 months from 
        the initial referral date.

Section 6. Government Accountability Office review

    Requires GAO review of the Board, agency S&D offices, and 
the case management system effectiveness.

Section 7. Coordination of remedies for fraud and corruption related to 
        procurement and grant activities

    Requires joint agency head/Inspector General guidance in 
each agency to institutionalize efficient agency-wide 
coordination of remedies for fraud and corruption related to 
procurement and grant activities, including legal, regulatory, 
administrative, and contractual remedies to maximize timely 
recovery of funds.

Section 8. Transfer, redesignation, and amendment of other provision of 
        law relating to debarment and suspension

    Provides technical or clerical amendments in the U.S. 
codes.

Section 9. Definitions

    Provides the definitions for the purpose of this bill.

Section 10. Authorization of appropriations

    Authorizes an additional $2 million for each of FY2015 
through FY2021 to carry out the functions of the Board and for 
implementation of the case management system. This augments the 
current GSA funding for its S&D operations (approx. six full-
time and three part-time employees).

Section 11. Effective date

    Provides the effective date.

                       Explanation of Amendments

    An amendment offered by Reps. Chaffetz and Speier was 
adopted by the Committee. The amendment further strengthens the 
SUSPEND Act by requiring timely referral and handling of S&D 
cases.
    Specifically, the amendment provides a 30-day time limit 
for the referred cases to be either accepted or rejected by the 
S&D official. If additional information is needed, the agency 
official or the IG who prepared the case file must be notified. 
It also requires all S&D cases to be resolved within 6 months 
from the initial referral date. The agency official or the IG 
who prepared the case file will be notified of any cases 
unresolved within that time frame and be updated every 3 months 
until the final resolution of the case.
    The amendment further requires that the annual report to 
Congress include the number and summary of any instances where 
the agency head made determinations to override S&D decisions 
and allowed a suspended or debarred entity to receive new 
contracts or grants.

                        Committee Consideration

    On October 29, 2013, the Committee met in open session and 
ordered reported favorably the bill, H.R. 3345, as amended, by 
voice vote, a quorum being present.

              Application of Law to the Legislative Branch

    Section 102(b)(3) of Public Law 104-1 requires a 
description of the application of this bill to the legislative 
branch where the bill relates to the terms and conditions of 
employment or access to public services and accommodations. 
This bill consolidates more than 40 executive agency suspension 
and debarment offices and programs into one centralized board 
named the Board of Suspension and Debarment, and encourages 
cost savings by sharing administrative resources with the pre-
existing Civilian Board of Contract Appeals. As such this bill 
does not relate to employment or access to public services and 
accommodations.

  Statement of Oversight Findings and Recommendations of the Committee

    In compliance with clause 3(c)(1) of rule XIII and clause 
(2)(b)(1) of rule X of the Rules of the House of 
Representatives, the Committee's oversight findings and 
recommendations are reflected in the descriptive portions of 
this report.

         Statement of General Performance Goals and Objectives

    In accordance with clause 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goals and objectives are reflected in the descriptive portions 
of this report.

                    Duplication of Federal Programs

    No provision of H.R. 3345 establishes or reauthorizes a 
program of the Federal Government known to be duplicative of 
another Federal program, a program that was included in any 
report from the Government Accountability Office to Congress 
pursuant to section 21 of Public Law 111-139, or a program 
related to a program identified in the most recent Catalog of 
Federal Domestic Assistance.

                  Disclosure of Directed Rule Makings

    H.R. 3345 requires the Director of the Office of Management 
and Budget to develop one generally applicable regulation on 
S&D for procurement and nonprocurement programs. The bill also 
requires the heads of each executive agency and the Inspector 
General of the agency to issue guidance that institutionalizes 
efficient agency-wide coordination of remedies for fraud and 
corruption related to procurement and grant activities.

                     Federal Advisory Committee Act

    The Committee finds that the legislation does not establish 
or authorize the establishment of an advisory committee within 
the definition of 5 U.S.C. App., Section 5(b).

                       Unfunded Mandate Statement

    Section 423 of the Congressional Budget and Impoundment 
Control Act (as amended by Section 101(a)(2) of the Unfunded 
Mandate Reform Act, P.L. 104-4) requires a statement as to 
whether the provisions of the reported include unfunded 
mandates. In compliance with this requirement the Committee has 
received a letter from the Congressional Budget Office included 
herein.

                         Earmark Identification

    H.R. 3345 does not include any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

                           Committee Estimate

    Clause 3(d)(2) of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison by the 
Committee of the costs that would be incurred in carrying out 
H.R. 3345. However, clause 3(d)(3)(B) of that rule provides 
that this requirement does not apply when the Committee has 
included in its report a timely submitted cost estimate of the 
bill prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act.

     Budget Authority and Congressional Budget Office Cost Estimate

    With respect to the requirements of clause 3(c)(2) of rule 
XIII of the Rules of the House of Representatives and section 
308(a) of the Congressional Budget Act of 1974 and with respect 
to requirements of clause (3)(c)(3) of rule XIII of the Rules 
of the House of Representatives and section 402 of the 
Congressional Budget Act of 1974, the Committee has received 
the following cost estimate for H.R. 3345 from the Director of 
Congressional Budget Office:

                                                  January 17, 2014.
Hon. Darrell Issa, Chairman,
Committee on Oversight and Government Reform,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3345, the SUSPEND 
Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Matthew 
Pickford.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 3345--SUSPEND Act

    Summary: H.R. 3345 would consolidate most federal efforts 
to suspend and debar individuals or organizations from 
receiving federal grants and contracts into a single office at 
the General Services Administration. In general, grantees or 
vendors may be prohibited or suspended from receiving federal 
funds because they have engaged in dishonest, unethical, or 
illegal conduct or are unable to perform their 
responsibilities. The bill also would establish an Interagency 
Suspension and Debarment Committee to coordinate activities, 
and authorize creation of a web-based management system to 
track all federal suspension and debarment cases. Finally, H.R. 
3345 would authorize the appropriation of $2 million annually 
over the 2015-2021 period for these activities.
    Assuming appropriation of the authorized amounts and based 
on information from GSA, CBO estimates that implementing H.R. 
3345 would cost $10 million over the 2015-2019 period (and an 
additional $4 million after 2019). Enacting the bill could 
affect direct spending by agencies not funded through annual 
appropriations; therefore, pay-as-you-go procedures apply. CBO 
estimates, however, that any net change in spending by those 
agencies would be negligible. Enacting the bill would not 
affect revenues.
    H.R. 3345 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would not affect the budgets of state, local, or tribal 
governments.
    Estimated Cost to the Federal Government: For this 
estimate, CBO assumes that the bill will be enacted in fiscal 
year 2014 and that the authorized amounts will be appropriated 
for each year. Estimated outlays are based on information from 
GSA and historical spending patterns of similar programs.
    The estimated budgetary impact of H.R. 3345 is shown on the 
following table. The cost of this legislation falls within 
budget function 800 (general government).

----------------------------------------------------------------------------------------------------------------
                                                              By fiscal year, in millions of dollars--
                                                  --------------------------------------------------------------
                                                                                                          2014-
                                                     2014     2015     2016     2017     2018     2019     2019
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION
 
Authorization Level..............................        0        2        2        2        2        2       10
Estimated Outlays................................        0        2        2        2        2        2       10
----------------------------------------------------------------------------------------------------------------

    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. Enacting the bill could affect direct spending by 
agencies not funded through annual appropriations; therefore, 
pay-as-you-go procedures apply. CBO estimates, however, that 
any net change in spending by those agencies would not be 
significant. Enacting the bill would not affect revenues.
    Intergovernmental and Private-sector Impact: H.R. 3345 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would not affect the budgets of state, 
local, or tribal governments.
    Estimate Prepared by: Federal costs: Matthew Pickford: 
Impact on state, local, and tribal governments; Melissa 
Merrell; Impact on the private sector: Paige Piper/Bach.
    Estimate Approved by: Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

TITLE 31, UNITED STATES CODE

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             SUBTITLE V--GENERAL ASSISTANCE ADMINISTRATION

Chap.                                                               Sec.
     * * * * * * *
6401Suspension and Debarment..........................................

           *       *       *       *       *       *       *


                  CHAPTER 64--SUSPENSION AND DEBARMENT

Sec.
6401. Board of Suspension and Debarment.
6402. Interagency Suspension and Debarment Committee.
6403. Single regulation for suspension and debarment for procurement and 
          nonprocurement programs.
6404. Uniform suspension, debarment, or exclusion from procurement or 
          nonprocurement activity.

Sec. 6401. Board of Suspension and Debarment

  (a) Establishment.--There is established in the General 
Services Administration a board for suspension and debarment to 
be known as the Board of Suspension and Debarment (in this 
section referred to as the ``Board'').
  (b) Purposes.--The purposes of the Board are to serve as a 
centralized body to manage all executive agency suspension and 
debarment activities and improve the suspension and debarment 
system through--
          (1) the transparent and efficient handling of cases;
          (2) the effective oversight of the Governmentwide 
        database containing the list of all excluded parties 
        ineligible for Federal programs pursuant to Executive 
        Orders No. 12549 and No. 12689, including oversight to 
        ensure receipt of information from other agencies and 
        to ensure timeliness, accuracy, and completeness of the 
        database;
          (3) the consistent and fair treatment of all persons 
        and entities subject to suspension or debarment 
        proceedings, including small businesses with limited 
        resources; and
          (4) active engagement with remedy coordination 
        officials (as defined in section 2307(i)(10) of title 
        10 and section 4506 of title 41) within executive 
        agencies for efficient referral of contractors, 
        grantees, or other recipients of Federal financial 
        assistance suspected of committing wrongful actions or 
        repeatedly performing poorly.
  (c) Effect of Determinations of Board.--
          (1) Conclusive on governmentwide basis.--The 
        determination by the Board on whether or not to debar 
        or suspend a contractor, grantee, or other recipient of 
        Federal financial assistance is conclusive on a 
        Governmentwide basis. No other agency may take a 
        contrary suspension and debarment action on a 
        Governmentwide basis with respect to the same 
        contractor, grantee, or other recipient based on the 
        facts and circumstances in the administrative record 
        considered by the Board.
          (2) Consideration of new or additional evidence.--In 
        considering any new or additional evidence of 
        nonresponsibility of a contractor, grantee, or other 
        recipient of Federal financial assistance not 
        previously considered by the Board, an agency, in 
        determining whether to award another grant or contract 
        or other Federal financial assistance to such 
        contractor, grantee, or other recipient, may consider 
        the cumulative effect of the facts and circumstances 
        previously considered by the Board.
  (d) Membership.--
          (1) Appointment.--The Board shall consist of members 
        appointed by the Administrator of General Services (in 
        consultation with the Administrator for Federal 
        Procurement Policy) from a register of applicants 
        maintained by the Administrator of General Services, in 
        accordance with rules issued by the Administrator of 
        General Services (in consultation with the 
        Administrator for Federal Procurement Policy) for 
        establishing and maintaining a register of eligible 
        applicants and selecting members. The Administrator of 
        General Services shall appoint a member without regard 
        to political affiliation and solely on the basis of the 
        professional qualifications required to perform the 
        duties and responsibilities of a member.
          (2) Chair.--The Administrator of General Services 
        shall designate one member of the Board to serve as 
        Chair of the Board. The position of Chair of the Board 
        shall be a Senior Executive Service position (as 
        defined by section 3132(a)(2) of title 5).
          (3) Removal.--The Administrator of General Services, 
        with the consent of the Administrator for Federal 
        Procurement Policy, may remove the Chair or any other 
        member of the Board.
  (e) Sharing of Resources.--The Administrator of General 
Services shall provide to the Board such administrative 
resources as are necessary for the Board to carry out its 
functions. In carrying out this subsection, the Administrator 
may provide for the sharing of administrative resources of the 
Civilian Board of Contract Appeals, such as the Board's 
information technology infrastructure, legal resources, and 
facilities.
  (f) Participation by Additional Entities.--The Board may 
enter into an agreement with any other entity that receives 
Federal funds for the Board to perform suspension and debarment 
activities on behalf of the entity.
  (g) Annual Report to Congress.--
          (1) In general.--Not later than October 30 of each 
        year, the Chair of the Board shall submit to the 
        relevant congressional committees a report containing 
        the following:
                  (A) A summary of the activities and 
                accomplishments of the Board in the 
                Governmentwide suspension and debarment system, 
                including the total number of referrals, 
                timeliness of case disposition, and breakdown 
                of discretionary and nondiscretionary cases.
                  (B) The number and summary of agency head 
                determinations, if any, that allowed a 
                suspended or debarred contractor, grantee, or 
                other recipient of Federal financial assistance 
                to receive new Federal funds.
                   (C) Recommendations to improve the 
                suspension and debarment system.
          (2) Form of report.--The Chair of the Board may 
        combine the report with the report required by section 
        6402(c)(7) of this title.
  (h) Definitions.--In this section:
          (1) Executive agency.--The term ``executive agency'' 
        has the meaning provided in section 133 of title 41.
          (2) Relevant congressional committees.--The term 
        ``relevant congressional committees'' means each of the 
        following:
                  (A) The Committee on Oversight and Government 
                Reform of the House of Representatives.
                  (B) The Committee on Homeland Security and 
                Governmental Affairs of the Senate.
          (3) Interagency Suspension and Debarment Committee.--
        The term ``Interagency Suspension and Debarment 
        Committee'' means the committee established under 
        section 6402 of this title.

Sec. 6402. Interagency Suspension and Debarment Committee

  (a) Establishment.--There is established the Interagency 
Suspension and Debarment Committee (in this section referred to 
as the ``Interagency Committee'' which shall replace the 
committee constituted under sections 4 and 5 of Executive Order 
No. 12549.
  (b) Chair and Vice Chairs.--
          (1) Chair.--The Administrator for Federal Procurement 
        Policy shall serve as Chair of the Interagency 
        Committee.
          (2) Vice chairs.--There are at least 2 Vice Chairs of 
        the Interagency Committee. The Chair of the Board of 
        Suspension and Debarment shall serve as a Vice Chair. 
        The Secretary of Defense shall designate one official 
        from the Department of Defense to serve as a Vice 
        Chair.
  (c) Duties.--The Interagency Committee shall--
          (1) resolve issues regarding which of several Federal 
        agencies is the lead agency having responsibility to 
        initiate suspension or debarment proceedings, including 
        with respect to contracts in connection with 
        contingency operations;
          (2) coordinate actions among interested agencies with 
        respect to such action;
          (3) encourage and assist Federal agencies in entering 
        into cooperative efforts to pool resources and achieve 
        operational efficiencies in the Governmentwide 
        suspension and debarment system;
          (4) recommend to the Office of Management and Budget 
        changes to the Government suspension and debarment 
        system and its rules, if such recommendations are 
        approved by a majority of the Interagency Committee;
          (5) authorize the Office of Management and Budget to 
        issue guidelines that implement those recommendations;
          (6) authorize the Chair of the Interagency Committee 
        to establish subcommittees as appropriate to best 
        enable the Interagency Committee to carry out its 
        functions; and
          (7) not later than October 30 of each year, submit to 
        Congress an annual report on--
                  (A) the progress and efforts to improve the 
                suspension and debarment system;
                  (B) member agencies' active participation in 
                the Interagency Committee's work;
                  (C) a summary of each agency's activities and 
                accomplishments in the Governmentwide 
                suspension and debarment system, including the 
                total number of referrals, timeliness of case 
                disposition, and breakdown of discretionary and 
                nondiscretionary cases; and
                  (D) the number and summary of agency head 
                determinations, if any, that allowed a 
                suspended or debarred contractor, grantee, or 
                other recipient of Federal financial assistance 
                to receive new Federal funds.
  (d) Definition.--In this section, the term ``contingency 
operation'' has the meaning given that term in section 
101(a)(13) of title 10.

Sec. 6403. Single regulation for suspension and debarment for 
                    procurement and nonprocurement programs

  (a) Single Regulation.--The Director of the Office of 
Management and Budget shall maintain one generally applicable 
regulation on suspension and debarment for procurement and 
nonprocurement programs.
  (b) Requirements.--
          (1) In general.--The regulation maintained pursuant 
        to subsection (a) shall provide, at a minimum, for the 
        procedures and other requirements set forth in 
        paragraphs (2) through (8).
          (2) Advance notice of adverse action.--The regulation 
        shall provide procedures for the Board to provide 
        advance notice of adverse action before any adverse 
        action may be taken against a private entity or 
        individual, unless the Chair of the Board of Suspension 
        and Debarment or the suspension and debarment officer 
        of an executive agency granted a waiver under section 
        2(b)(2) of the SUSPEND Act determines that an expedient 
        action is necessary to protect the interest of the 
        Government.
          (3) Transparent handling of cases.--The regulation 
        shall provide procedures for transparent handling of 
        all cases, including public availability of--
                  (A) the outcome of all referred cases, 
                including the rationale for the decision to 
                take or not take an adverse action; and
                  (B) the administrative agreements entered 
                into by the Government in order to resolve a 
                suspension or debarment proceeding.
          (4) Timely referrals and processing of cases.--
                  (A) The regulation shall provide procedures 
                to strengthen timely referrals of cases, 
                including--
                          (i) the role of the agency remedy 
                        coordination official to act upon cases 
                        brought to such official's attention in 
                        a timely manner (as required in section 
                        7 of the SUSPEND Act); and
                          (ii) requirements for the Board or 
                        the agency suspension and debarment 
                        office to review the sufficiency of the 
                        information in the referred cases and 
                        to notify the agency remedy 
                        coordination official and cognizant 
                        Inspector General (if the case is 
                        originated from the Office of Inspector 
                        General) within 30 days after the 
                        initial referral date for any 
                        additional information if needed.
                  (B) The regulation shall require all cases to 
                be disposed of within 6 months after the 
                initial referral date, unless the Chair of the 
                Board or the agency suspension and debarment 
                officer provides a written explanation and 
                estimated timeline to the agency remedy 
                coordination official and cognizant Inspector 
                General (if the case is originated from the 
                Office of Inspector General). Such written 
                explanation shall be updated every 3 months 
                until the final resolution of the case.
          (5) Consistent standards and procedures.--The 
        regulation shall provide procedures to ensure 
        consistent standards and procedures that treat all 
        alleged violators fairly and expeditiously, including 
        small businesses with limited legal resources.
          (6) Repeated failure to perform.--The regulation 
        shall provide procedures to strengthen the 
        identification and referral (for suspension or 
        debarment consideration) of contractors and grantees 
        that repeatedly fail to perform.
          (7) Contingency procedures.--The regulation shall 
        provide procedures for an expedited review process to 
        handle contract or grant fraud in a non-traditional or 
        time-sensitive environment, either in a military or 
        non-military setting.

Sec. 6404. Uniform suspension, debarment, or exclusion from procurement 
                    or nonprocurement activity

  (a) Requirement for Regulations.--Regulations shall be issued 
providing that provisions for the debarment, suspension, or 
other exclusion of a participant in a procurement activity 
under the Federal Acquisition Regulation, or in a 
nonprocurement activity under regulations issued pursuant to 
Executive Order No. 12549, shall have government-wide effect. 
No agency shall allow a party to participate in any procurement 
or nonprocurement activity if any agency has debarred, 
suspended, or otherwise excluded (to the extent specified in 
the exclusion agreement) that party from participation in a 
procurement or nonprocurement activity.
  (b) Authority To Grant Exception.--The regulations issued 
pursuant to subsection (a) shall provide that an agency may 
grant an exception permitting a debarred, suspended, or 
otherwise excluded party to participate in procurement 
activities of that agency to the extent exceptions are 
authorized under the Federal Acquisition Regulation, or to 
participate in nonprocurement activities of that agency to the 
extent exceptions are authorized under regulations issued 
pursuant to Executive Order No. 12549.
  (c) Definitions.--In this section:
          (1) The term ``procurement activities'' means all 
        acquisition programs and activities of the Federal 
        Government, as defined in the Federal Acquisition 
        Regulation. Such term includes subcontracts at any 
        tier, other than subcontracts for commercially 
        available off-the-shelf items (as defined in section 
        104 of title 41), except that in the case of a contract 
        for commercial items, such term includes only first-
        tier subcontracts.
          (2) The term ``nonprocurement activities'' means all 
        programs and activities involving Federal financial and 
        nonfinancial assistance and benefits, as covered by 
        Executive Order No. 12549 and the Office of Management 
        and Budget guidelines implementing that order.
          (3) The term ``agency'' means an Executive agency as 
        defined in section 103 of title 5.

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                              ----------                              


 DUNCAN HUNTER NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 2009

                          (Public Law 110-417)

 AN ACT To authorize appropriations for fiscal year 2009 for military 
activities of the Department of Defense, for military construction, and 
   for defense activities of the Department of Energy, to prescribe 
   military personnel strengths for such fiscal year, and for other 
purposes.

           *       *       *       *       *       *       *


SEC. 2. ORGANIZATION OF ACT INTO DIVISIONS; TABLE OF CONTENTS.

  (a) * * *
  (b) Table of Contents.--The table of contents for this Act is 
as follows:

           *       *       *       *       *       *       *


            DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATIONS

     * * * * * * *

  TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED 
                                 MATTERS

     * * * * * * *

           Subtitle G--Governmentwide Acquisition Improvements

     * * * * * * *
[Sec. 873. Role of Interagency Committee on Debarment and Suspension.]

           *       *       *       *       *       *       *


DIVISION A--DEPARTMENT OF DEFENSE AUTHORIZATIONS

           *       *       *       *       *       *       *


  TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED 
MATTERS

           *       *       *       *       *       *       *


           Subtitle G--Governmentwide Acquisition Improvements

     * * * * * * *
[Sec. 873. Role of Interagency Committee on Debarment and Suspension.]

           *       *       *       *       *       *       *


Subtitle G--Governmentwide Acquisition Improvements

           *       *       *       *       *       *       *


[SEC. 873. ROLE OF INTERAGENCY COMMITTEE ON DEBARMENT AND SUSPENSION.

  [(a) Requirement.--The Interagency Committee on Debarment and 
Suspension shall--
          [(1) resolve issues regarding which of several 
        Federal agencies is the lead agency having 
        responsibility to initiate suspension or debarment 
        proceedings, including with respect to contracts in 
        connection with contingency operations'' before the 
        semicolon;
          [(2) coordinate actions among interested agencies 
        with respect to such action;
          [(3) encourage and assist Federal agencies in 
        entering into cooperative efforts to pool resources and 
        achieve operational efficiencies in the Governmentwide 
        suspension and debarment system;
          [(4) recommend to the Office of Management and Budget 
        changes to the Government suspension and debarment 
        system and its rules, if such recommendations are 
        approved by a majority of the Interagency Committee;
          [(5) authorize the Office of Management and Budget to 
        issue guidelines that implement those recommendations;
          [(6) authorize the chair of the Committee to 
        establish subcommittees as appropriate to best enable 
        the Interagency Committee to carry out its functions; 
        and
          [(7) submit to Congress an annual report on--
                  [(A) the progress and efforts to improve the 
                suspension and debarment system;
                  [(B) member agencies' active participation in 
                the committee's work;
                  [(C) a summary of each agency's activities 
                and accomplishments in the Governmentwide 
                debarment system; and
                  [(D) a summary of suspensions, debarments, 
                and administrative agreements during the 
                previous year.
  [(b) Date of Submittal of Annual Reports.--The annual report 
required by subsection (a)(7) shall be submitted not later than 
January 31 of each year, beginning with January 31, 2014.
  [(c) Definitions.--In this section:
          [(1) The term ``contingency operation'' has the 
        meaning given that term in section 101(a)(13) of title 
        10, United States Code.
          [(2) The term ``Interagency Committee on Debarment 
        and Suspension'' means the committee constituted under 
        sections 4 and 5 of Executive Order No. 12549.]

           *       *       *       *       *       *       *

                              ----------                              


              FEDERAL ACQUISITION STREAMLINING ACT OF 1994

                          (Public Law 103-355)

  AN ACT To revise and streamline the acquisition laws of the Federal 
Government, and for other purposes.

           *       *       *       *       *       *       *


SEC. 2. TABLE OF CONTENTS.

  The table of contents for this Act is as follows:

           *       *       *       *       *       *       *


                    TITLE II--CONTRACT ADMINISTRATION

     * * * * * * *
Subtitle E--Miscellaneous
     * * * * * * *

                     Part II--Acquisitions Generally

     * * * * * * *
[Sec. 2455. Uniform suspension and debarment. ]

           *       *       *       *       *       *       *


TITLE II--CONTRACT ADMINISTRATION

           *       *       *       *       *       *       *


Subtitle E--Miscellaneous

           *       *       *       *       *       *       *


PART II--ACQUISITIONS GENERALLY

           *       *       *       *       *       *       *


[SEC. 2455. UNIFORM SUSPENSION AND DEBARMENT.

  [(a) Requirement for Regulations.--Regulations shall be 
issued providing that provisions for the debarment, suspension, 
or other exclusion of a participant in a procurement activity 
under the Federal Acquisition Regulation, or in a 
nonprocurement activity under regulations issued pursuant to 
Executive Order No. 12549, shall have government-wide effect. 
No agency shall allow a party to participate in any procurement 
or nonprocurement activity if any agency has debarred, 
suspended, or otherwise excluded (to the extent specified in 
the exclusion agreement) that party from participation in a 
procurement or nonprocurement activity.
  [(b) Authority To Grant Exception.--The regulations issued 
pursuant to subsection (a) shall provide that an agency may 
grant an exception permitting a debarred, suspended, or 
otherwise excluded party to participate in procurement 
activities of that agency to the extent exceptions are 
authorized under the Federal Acquisition Regulation, or to 
participate in nonprocurement activities of that agency to the 
extent exceptions are authorized under regulations issued 
pursuant to Executive Order No. 12549.
  [(c) Definitions.--In this section:
          [(1) The term ``procurement activities'' means all 
        acquisition programs and activities of the Federal 
        Government, as defined in the Federal Acquisition 
        Regulation. Such term includes subcontracts at any 
        tier, other than subcontracts for commercially 
        available off-the-shelf items (as defined in section 
        35(c) of the Office of Federal Procurement Policy Act 
        (41 U.S.C. 431(c))), except that in the case of a 
        contract for commercial items, such term includes only 
        first-tier subcontracts.
          [(2) The term ``nonprocurement activities'' means all 
        programs and activities involving Federal financial and 
        nonfinancial assistance and benefits, as covered by 
        Executive Order No. 12549 and the Office of Management 
        and Budget guidelines implementing that order.
          [(3) The term ``agency'' means an Executive agency as 
        defined in section 103 of title 5, United States Code.]

           *       *       *       *       *       *       *

                              ----------                              


TITLE 5, UNITED STATES CODE

           *       *       *       *       *       *       *


PART III--EMPLOYEES

           *       *       *       *       *       *       *


SUBPART G--INSURANCE AND ANNUITIES

           *       *       *       *       *       *       *


CHAPTER 89--HEALTH INSURANCE

           *       *       *       *       *       *       *


Sec. 8902a. Debarment and other sanctions

  (a) * * *
  (b) The Office of Personnel Management shall bar the 
following providers of health care services or supplies from 
participating in the program under this chapter:
          (1) * * *

           *       *       *       *       *       *       *

          (5) Any provider that is currently debarred, 
        suspended, or otherwise excluded from any procurement 
        or nonprocurement activity (within the meaning of 
        [section 2455 of the Federal Acquisition Streamlining 
        Act of 1994] section 6404 of title 31).

           *       *       *       *       *       *       *